Oil & Natural Gas Corpn Ltd

Dear Shareholders,

On behalf of the Board of Directors of Oil & Natural Gas Corporation Limited (ONGC/ the Company), it is my privilege to present you with the Integrated Annual Report for the financial year 2024-25 (FY'25), outlining the Company's performance. The global economy stands at a pivotal crossroads. Long-held global certainties are giving way to fragmentation with rising geopolitical tensions and diverging national interests straining established frameworks. What we're witnessing is not a temporary disruption, but a structural shift in global trade dynamics. Sanctions, tariffs, and protectionist policies are no longer episodic; they are redefining the rules of engagement.

As we progress through mid-2025, I remain cautiously optimistic about the economic road ahead. While central banks are dialing back aggressive rate hikes, inflation remains a persistent challenge. For developing economies already navigating fragile fiscal landscapes, this convergence of pressures risks excluding billions from the path to recovery. The message is clear: coordinated, inclusive action is no longer optional—it's urgent. At the same time, the oil and gas companies are navigating a profound transformation—one that mirrors the broader shifts reshaping the global energy landscape. The system is being redrawn in real time, driven by fluctuating oil markets, geopolitical pressures, and an energy transition progressing at an uneven pace. In this environment, the margin for passive strategy is disappearing.

Looking ahead, the challenges are clear: The industry faces mounting risks—oversupply, price compression, and inevitable consolidation. Yet the imperative isn't just to manage today's volatility—it's to prepare for tomorrow's energy reality. The next few years will be defining, as companies are called to strike a delicate balance: sustaining reliable hydrocarbon supply while moving toward a low-carbon future. For our Company, this is not just a pivotal moment—it is an inflection point. Navigating this dual mandate requires not only agility, but conviction. Our legacy will be defined by the courage of our choices—the ability to lead decisively amid ambiguity, to invest beyond the current cycle, and to position ourselves not merely as participants in the transition, but as architects of a more resilient and sustainable energy for future.

Your Company has been proactively leveraging the latest technologies, including AI and advanced digital solutions, to enhance productivity and operational efficiency across its value chain. The commissioning of the ‘Urja Utkarsh Kaksh' Digital War Room at Ahmedabad Asset, equipped with the SANJAI (Systematic, Analytics, Network of Jointly Managed Asset Information) dashboard is a significant step in this direction. In Mumbai High Asset, ONGC successfully implemented the Integrated Digital Analytics System (IDAS), creating an intelligent, physics-based platform for monitoring and optimizing well and flow-line networks. A major technological breakthrough was achieved through the successful demonstration of autonomous downhole steering at an exploratory well in Mehsana, remotely operated from the Real-Time Drilling Operations Center (RTDOC), Dehradun. This milestone validated fully automated trajectory control, precision drilling, and real-time remote command capabilities. These significant strides in deploying AI-driven systems for exploration, drilling and predictive maintenance shall enable faster decision-making and reduce downtime, thereby enhancing the productivity and efficiency in entire system.

In FY'25, your Company scripted a remarkable turnaround by recording its first production growth in nearly a decade, as standalone crude output rose by 0.9%. Your Company continues to exemplify excellence in field management through strategic implementation of global best practices and advanced recovery methodologies, optimizing output from its mature assets. In response to the natural decline in offshore production, ONGC has embraced a forward-looking Technology, Services, and Partnerships (TSP) framework. A significant development within this model is the recently established partnership with BP as "Technology Service Provider", focused on revitalizing production at the renowned Mumbai High field. Leveraging BP's global experience in handling matured reservoirs, your Company is positioned to generate additional value from its flagship Mumbai High asset. Looking ahead to FY'26, the company remains focused on accelerating output from its recent discoveries, enhancing recovery from ageing fields, and expand its TSP strategy—reinforcing its operational leadership in innovation and its commitment to sustaining India's energy security.

With a 20% premium now realized for gas produced from new wells, Natural gas will become increasingly important to your Company's growth. The upcoming monetization of the Daman Upside Development Project (DUDP) in Q3 FY'26, will boost domestic gas output. FY'25 marked a key milestone with the commencement of CBM gas sales from Bokaro and North Karanpura. Backed by India's expanding city gas distribution (CGD) network and stable policy support, ONGC is well-positioned to lead the transition toward a robust and cleaner gas-based economy. Amendment to Oilfileds Regulation Act that provides fiscal stability, sharing of resources, expeditious dispute resolution mechanism is a bold step by GoI to boost exploration and production in the country.

Building on its robust trajectory, your Company has maintained remarkable momentum throughout FY'25, achieving standout results across its core E&P operations. Your Company notified nine new hydrocarbon discoveries—seven new prospects and two new pools—spanning both onshore and offshore acreages, in basins including Mumbai Offshore, Bengal, Cambay, Krishna-Godavari, and Cauvery. A new prospect discovery at Ranaghat-2 in the Bengal Basin further validated ONGC's persistent push to upgrade Category-III basins. The exploratory success ratio stood at an impressive 43.5%, with 47 out of 108 tested wells proving hydrocarbon-bearing. Your Company has monetized eight discoveries in FY'25, including West Matar-2 and Yandapalli-1—both discovered in the last fiscal—along with six earlier finds. In FY'25, your Company acquired 604 line kilometers (LKM) of 2D seismic data and 8,840 square kilometers (SKM) of 3D seismic data. With the addition of 15 new blocks awarded under OALP Bid Round-IX, ONGC is strategically positioned to capitalize on a new phase of significant discoveries. The company also advanced its exploration portfolio by drilling 12 wells targeting basement formations and pursuing development in high-pressure, high-temperature (HP-HT) reservoirs.

As deepwater and ultra-deepwater sectors reshape the landscape of oil and gas exploration, your Company consistently exhibits strategic adaptability and technical expertise in addressing the challenges presented by these complex environments. The breakthrough at Chola-1 underscores the immense untapped potential of India's ultra-deepwater basins. In a major thrust towards unlocking frontier basins, ONGC has also commenced ultra-deepwater drilling operations in Andaman, a region fast emerging as one of India's promising untapped hydrocarbon provinces. These efforts are being propelled by favorable government policies that incentivize exploration. Your Company is pursuing deepwater collaboration with leading energy companies, including BP, ExxonMobil, Total Energies, and Petrobras, as part of a strategic initiative to mitigate risks associated with exploration in high-cost frontier regions.

Your Company has maintained a robust capital expenditure (CAPEX) outlay, by investing Rs. 62,057 crore in FY'25, achieving highest ever utilization (excluding acquisitions) in a financial year for strengthening growth prospects of the company. In this period, six major projects worth around Rs. 8,947 crore were completed.

Currently twenty-one major projects of over Rs. 100 crore are under execution with a total cost of around Rs. 65,389 crore and envisaged lifecycle gain of ~84 MMTOE. Your Company has been consistently expanding its Enhanced Oil Recovery (EOR) portfolio. Under the Enhanced Recovery (ER) policy, 33 ER Pilot/Preliminary Screening reports for Oil Fields have been submitted to DGH up to 31st March 2025. Of these, 17 pilot schemes have been approved (phase-I) and 11 are under consideration (phase II), representing a structured effort to improve recovery from mature fields.

Your Company drilled a staggering total of 578 wells during FY'25, which is highest in the last 35 years. 109 of these wells were exploratory wells, while the remaining 469 wells were development wells including side-track wells. During FY'25, your Company's Crude oil production from ONGC operated blocks was 19.598 MMT and Natural gas production was 19.654 BCM as against Crude Oil production of 19.471 MMT and Natural gas production of 19.978 BCM in FY'24. A total of 2.596 MMT of Value-Added Products (VAPs) were also produced during the year as against 2.519 MMT in FY'24.

In terms of financial performance, your Company's revenue from operations stood at Rs. 1,37,846 crore, in FY'25 against previous year's Rs. 1,38,402 crore, due to lower realization of crude oil price (USD 76.90/bbl in FY'25 vs USD 80.77/bbl in FY'24). Profit After Tax (PAT) stood at Rs. 35,610 crore in FY'25, as compared to Rs. 40,526 crore in FY'24, primarily due to higher exploratory write-offs. Your Company declared a total dividend payout of Rs. 15,411 crore, representing a payout ratio of 43.27%. This reflects ONGC's continued ability to generate value for shareholders while navigating a complex and evolving energy environment.

Your Company's ambitious ‘Net Zero by 2038' strategy shall not only deliver a cleaner emissions profile but also drive revenue growth and value creation through a massive 2 lac crore rupees investment in this segment. Since beginning operations on 10 April 2024, ONGC's fully owned subsidiary ONGC Green Limited (OGL) has rapidly made significant strides in the renewable energy domain. OGL acquired PTC Energy Ltd. (now OGL One Limited), adding seven wind plants with 288.8 MW capacity in Madhya Pradesh, Karnataka, and Andhra Pradesh. Through its joint venture ONGC NTPC Green Private Limited, OGL also acquired Ayana Renewable Power Private Ltd. in March 2025, bringing in 2.05 GW to ONGC out of the total 4.1 GW of wind and solar assets. These acquisitions have raised ONGC's renewable capacity to 2.5 GW, in line with the company's stated goal of reaching 10 GW by 2030.

ONGC's subsidiaries and joint ventures serve as a strategic buffer against the inherent volatility of the E&P business. Through their diversified operations and targeted investments spanning upstream, midstream and downstream sectors, they fortify the ONGC group's resilience to sectoral fluctuations, ensuring sustained energy security and cementing its position as India's only fully integrated energy enterprise. On a consolidated basis, ONGC Group delivered a resilient performance in FY'25, with 775.42 MMTOE of 1P reserves, 51.36 MMT of oil and gas production, and 43.31 MMT of refinery thruput.

To unlock greater value from its energy portfolio, your Company is set to launch a dedicated oil trading vertical in FY'26. This initiative will provide the agility to navigate market fluctuations, enhance price realization, leverage the position of ONGC Group as a fully integrated entity and strengthen its position across the value chain. It shall be a major strategic step toward integrated energy operations.

The international E&P arm of ONGC, ONGC Videsh Limited (OVL), continues to play a pivotal role in expanding the company's global footprint, with business presence in 19 countries across 5 continents. Presently it operates in 32 oil and gas projects, including 14 producing and 11 exploration assets. OVL contributed over 10 MMTOE to ONGC's consolidated production in FY'25, reaffirming its position as India's second-largest E&P entity after ONGC itself.

In FY'25, ONGC Videsh maintained stable operational output despite geopolitical challenges and maturing fields. The company reported a total production of 10.278 MMTOE, with oil output increasing slightly to 7.265 MMT and gas production at 3.013 BCM. Notable contributions came from the CPO-5 block and MECL asset in Colombia and GPOC and SPOC projects in South Sudan. The CPO-5 block in Columbia also saw a significant breakthrough: the discovery of a new play, LS-3, within the La Urraca evaluation area. ONGC Videsh's exploration efforts in the last fiscal also helped to secure extensions in exploration license in promising fields in South Sudan. The company expanded its strategic footprint by acquiring additional PI in Azerbaijan's producing Azeri, Chirag, and Gunashli (ACG) field and stake in the Baku-Tbilisi-Ceyhan (BTC) Pipeline Company. ONGC Videsh also entered into an MoU with UAE-based International Resources Holding RSC Ltd. (IRH) along with Oil India Limited (OIL) and Khanij Bidesh India Ltd. (KABIL) for critical minerals, signaling strategic alignment with future energy demands and diversification efforts. Gross consolidated revenue of ONGC Videsh for FY'25 was Rs. 12,995 crore (against Rs. 13,197 crore during FY'24) and the Profit After Tax (PAT) was Rs. 418 crore during FY'25 as against Rs. 490 crore (restated) during FY'24.

In the downstream segment, ONGC continues to benefit from the exceptional performance of its key subsidiaries.

HPCL delivered a stellar performance in FY'25, by achieving a record combined refining throughput of 25.27 MMT at its Mumbai and Visakhapatnam refineries, marking a robust 13.2% increase over the previous year. HPCL also posted its highest-ever total sales volume of 49.82 MMT, growing 6.4% year-on-year, and significantly outpacing the industry average in domestic sales. The company achieved a record pipeline throughput of 26.90 MMT and expanded its retail footprint to over 23,747 outlets. It also commenced operations at its LNG regasification terminal in Chhara, Gujarat, highlighting its commitment to value chain diversification. Despite global pressure on margins leading to a reduction in average GRM to US$ 5.74 per barrel (from US$ 9.08 per barrel in FY'24), HPCL maintained resilient financials with revenue from operations stood at Rs. 4,66,346 crore and standalone profit after tax of Rs. 7,365 crore.

In FY'25, MRPL achieved its highest-ever crude throughput of 18.04 MMT, operating at 120% of installed capacity as compared to 16.59 MMT during FY'24. Despite facing challenges from volatile crude prices and compressed refining margins (USD 4.45/ bbl in FY'25 against USD 10.36/ bbl in FY'24), MRPL remained profitable and continued to optimize operations. During FY'25, MRPL registered a standalone turnover of Rs. 1,09,277 crore against Rs. 1,05,223 crore in FY'24 and recorded profit after tax of Rs. 51 crore (against Profit after tax of Rs. 3,596 crore in FY'24). MRPL's performance reflects its strong operational discipline and its critical role in ONGC Group's downstream integration strategy. OPaL represents a strategic cornerstone in ONGC's downstream diversification and value integration journey. As ONGC's largest Greenfield investment and now a majority-owned subsidiary with a 95.69% stake, OPaL holds immense significance in strengthening ONGC's presence in India's fast-growing petrochemical market. Recognizing its long-term potential, your Company took decisive steps to address OPaL's financial challenges through a Rs. 18,365 crore capital restructuring and exit from SEZ area. In parallel, to ensure feedstock stability and reduce reliance on volatile LNG markets, the Government of India has approved allocation of up to 3.2 MMSCM/day of gas from new wells. These interventions are poised to significantly enhance OPaL's operational performance and sustainability, positioning it as a value-accretive asset in ONGC's integrated energy portfolio. OPaL has sold 1785 KT of petchem products during FY'25 against 1769 KT during FY'24, while its Revenue from operations stood at Rs. 14,804 Crore during FY'25 compared to Rs. 14,307 Crore during FY'24.

Health, Safety, and Environment (HSE) principles form the cornerstone of your Company's long-term vision and overall approach to sustainable growth. FY'25 saw a notable 18% reduction in overall incident occurrences compared to the previous fiscal year—an encouraging indication of continuous improvement in safety performance. During FY'25 your Company provided vocational training to 3,546 personnel, further strengthening its commitment to workforce readiness and safe operations. Your Company has implemented SAP-based systems for real-time tracking of safety incidents, audits, e-permits, and change management, ensuring transparency and compliance. Aligned with the Mission LiFE initiative, your Company has been conducting awareness campaigns via webinars and digital platforms. Under ‘Ek Ped Maa Ke Naam', 1.5 lakh saplings each were planted in Mehsana, Gujarat and Sivaganga, Tamil Nadu with robust monitoring and maintenance systems ensuring long-term survival. The initiative reinforces ONGC's broader environmental commitment, particularly in soil conservation and river rejuvenation efforts.

ESG remains a key priority for your Company, not only as a strategic business consideration but also as a reflection of its role as a responsible corporate citizen. Your Company earned a B- rating in the 2024 CDP (Carbon Disclosure Project) thematic score for climate, reflecting ONGC's commitment to transparent

Environmental, Social, and Governance (ESG) practices and its role as a responsible energy leader. In addition, S&P Global upgraded the rating outlook on ONGC from 16 to 28 in 2024, marking a strong upward trend in both creditworthiness and ESG performance.

Your Company has registered the highest-ever CSR expenditure of Rs. 929 crore in FY'25 with significant focus on healthcare and nutrition. Of this, Rs. 93 crore was allocated to 45 Aspirational Districts. As a leading organisation in India's development, ONGC continues to demonstrate its commitment towards social responsibility.

Your Company firmly believes that its people are its greatest strength. In FY'25, our HR initiatives were anchored in building a high-performance, future-ready workforce committed to the Company's evolving vision. Your Company is actively leveraging digital technologies and data-driven tools to modernize HR operations, streamline internal processes and strengthen learning ecosystems. In FY'25, skill enhancement initiatives saw over 17,700 employees being trained across key domains. In FY'25, your Company also launched the Accelerated Leadership Development Programme, "Unnati Shikhar", to build a future-ready leadership pipeline. Targeting high-potential mid-level management executives, 120 were selected for calibrated exposure to experiential learning and challenging roles. In FY'25, the Advanced Training Institute (ATI) in Goa successfully marketed its world-class infrastructure and began generating revenue. The institute is now accredited with international agencies to deliver world class courses of OPITO, NEBOSH and IOSH.

Your Company is committed to conduct its business in the most ethical and transparent manner, observing the highest corporate governance standards. Corporate Governance Report forms part of Annual Report and details out governance practices along with Certificate of Compliance of Conditions of Corporate Governance. I express my sincere gratitude to all stakeholders for their valuable contributions to our Company's achievements. The Board, customers, business partners, investors, regulators, and others who have entrusted us with their confidence have each played a vital role in our progress. I also wish to acknowledge our employees for their steadfast commitment, resilience, and professionalism throughout these challenging times.

I would like to extend my sincere gratitude to the Government of India, in particular the Ministry of Petroleum and Natural Gas, for their strategic guidance and consistent support.

On behalf of our entire team, I thank all our shareholders for their continued guidance and support. I am sure that this lasting association will continue to gain strength and remain an invaluable asset for years to come.